Fitch downgrades OTE

Fitch Ratings said it downgraded Hellenic Telecommunications Organization SA's (OTE) long-term foreign-currency issuer default rating and OTE plc's senior unsecured rating to BB from BBB-.

The outlook is evolving.

The action follows the three-notch downgrade of the Hellenic Republic's sovereign ratings to B+ from BB+ with a negative outlook, Fitch said.

The agency had indicated that a sovereign downgrade to the B category would lead to a maximum corporate issuer default rating for primarily domestic corporate entities in the BB category.

The downgrade reflects the constraint on OTE's ratings from the local- and foreign-currency ratings of its primary jurisdiction of operation in Greece, rather than the recent further weakening of OTE's financial performance, the agency said.

The evolving outlook considers that current rating level represents a floor based on the direct influence of the sovereign rating should the sovereign's ratings deteriorate further, Fitch said.

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